HTML is the main format that fuels the world wide web.
Web applications are applications that run somewhere on the internet, and that web browsers talk to. E.g. if you check your Twitter or Facebook feed your browser talks to the respective applications that are run by these companies.
So one could say that the primary purpose of web applications is to produce HTML so it can be sent to web browsers.
Because generating HTML dynamically based on some data (e.g. the current user’s name, and their tweets, or emails) is such an important concern of applications Ruby has some built-in support for making this easier: a library called ERB, short for “embedded Ruby”.